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According to research from Novuna Business Finance, 86% of UK small business owners are concerned that the upcoming Autumn Budget could negatively impact their growth outlook and finances.
Among those expressing concern, key issues included potential increases in national insurance (49%), VAT (48%), and income tax (50%). Traditional sectors voiced apprehension about flexible working requirements, while the property sector worried about the impact of potential rises in Capital Gains Tax and Inheritance Tax.
The survey findings come as small business confidence has seen a slight uptick, with the percentage of businesses predicting growth rising from 30% to 35% following the General Election, marking a two-year high after a period of stagnation caused by the cost-of-living crisis. However, 78% of businesses expecting significant expansion by December 2024 also expressed fears that the Budget could hamper their growth plans.
The survey polled 1,046 small business owners and found widespread concern about potential Budget policies across all industry sectors, with at least 81% of respondents from each sector identifying potential risks. Concerns varied by sector, with national insurance rises particularly worrying for manufacturing (61%), transport and distribution (61%), and construction (56%).
Income tax increases were a major concern in the retail and property sectors (both 56%), where maintaining consumer confidence is crucial. Transport and distribution (68%) and construction (63%) sectors were most worried about potential fuel duty hikes.
Employers in manufacturing (44%) and transport (44%) feared the impact of mandatory flexible working arrangements, while hospitality (42%) and manufacturing sectors were concerned about increases to minimum wage rates. Nationally, 21% of small businesses were anxious about the impact of immediate parental leave and statutory sick pay rights.
Property sector businesses expressed concern over potential rises in Capital Gains Tax and Inheritance Tax (48%), fearing a ripple effect on their enterprises.
Joanna Morris, Head of Insight at Novuna Business Finance, emphasised the importance of the Autumn Budget, noting that while speculation continues, the uncertainty is a significant worry for small businesses. She stressed that while recent signs of economic recovery were welcome, fiscal changes that add to the cost burden or undermine consumer confidence could jeopardise small business growth going into 2025.
“UK small businesses fear Autumn Budget impact on growth” was originally created and published by Leasing Life, a GlobalData owned brand.